When property is mortgaged, the property is transferred to a creditor to be used as secured collateral on a loan. The individual exchanging the property for the loan becomes the mortgagor, and the creditor acquiring the property title becomes the mortgagee. If the mortgagor defaults on the loan payments associated with the mortgage, the creditors can take legal action to enforce a mortgage against the property and prevent the mortgagor from keeping the property.

Real estate tips from Derek Ebrecht of GREEN LIGHT REALTY. Information is provided by "It's Time to Move Up", the real estate resource for consumers who want their questions answers in ways they can understand. Derek specializes in foreclosure homes and foreclosure homes only.

Answer: When a property is in pre-foreclosure (NOD, LIS), the owner still has a chance to stop the foreclosure process by paying off what is owed or by selling the property. The pre-foreclosure period can last several months, so you may need to be patient when trying to contact the owner in default.

If you receive a Release form, you are eligible to receive a payment under the Settlement. However, participating in the Settlement and receiving a payment will NOT stop or undo a foreclosure. If you choose to participate in the Settlement, you must sign and return the Release form. In doing so, you give up various legal rights (listed on the Release form), but you do not give up your right to raise any rights and defenses in a foreclosure action.

A forclosed property auction is like any other auction - property is sold to the highest bidder. Remember, you are going to be bidding against other potential investors. So prepare in advance and know how much the property is really worth and you'll end up with the most profit.

You need to act fast. Most people in this situation are in denial. They do not realize they will soon lose their home and their credit.

Judicial foreclosure action is a proceeding in which a mortgage, a trustee or another lienholder on property on property requests a court-supervised sale of the property to cover the unpaid balance of a delinquent debt. Nonjudicial foreclosure is the process of selling real property under a power of sale in a mortgage or deed of trust that is in default.

If a borrower fails to make regular mortgage payments in accordance with the terms and conditions of the mortgage agreement then the lender can resort to foreclosure. Lender has the rights to put the home for sale in the open market to recover money due to him.

A:One reason there are few bidders at foreclosure sales is that it is next to impossible to get financing for such a property. You generally need to show up with cash and lots of it, or a line of credit with your bank upon which you can draw cashier's checks.

The best way to stop the foreclosure is to bring the loan current. To do that you would need to pay all delinquent amounts as well as the costs and fees incurred by the mortgage company to file and process the foreclosure. Many borrowers are not able to bring the loan current and are forced to look at other alternatives to avoid foreclosure.

By almost any measure a completed foreclosure is the most damaging event your credit status can encounter – worse than bankruptcy. A foreclosure on your credit record will negatively impact your ability to borrow money for years. For most people, it is well worth the time and effort to solve the problem before the foreclosure is done.